What's Up With Tax Day?

Which deadline was extended?

Yesterday, the IRS announced that the April 15th deadline for federal tax return filing and payments due for individuals, tax year 2020, will be automatically extended to May 17th, with formal guidance to practitioners to follow in the coming days.

“Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to.”

- IRS Commissioner Chuck Rettig

What doesn’t this mean?

This automatic extension does NOT apply to 2021 Q1 estimated tax payments that are due April 15, 2021. Those are still due April 15, 2021 (as of the time of this update on March 18). Because tax return work has to be done in order to calculate the estimated payments, the postponement of the filing deadline is of little-to-no benefit in those situations.

It also does not currently apply to C-Corporations (Form 1120) or tax returns for Estates and Trusts (Form 1041).

The filing deadline postponement does not include state tax payments or deposits. Every state agency should still be checked for their latest guidance regarding taxation at the state level. You can check that at this link.

AICPA Reaction and What’s Ahead

Members of the AICPA continue to push the Department of the Treasury and the IRS to extend all federal returns to June 15th - the same deadline put in effect by states who experienced winter disasters, and the same deadline as the Q2 Estimated Payments for 2021. They point out that a June 15th deadline would lighten the impact for taxpayers, tax professionals, and help states maintain revenue levels within their current fiscal years.

Here is a more in-depth explanation from the WSCPA, including snippets about the AICPA’s opinion.

“This selective decision by the IRS unfortunately creates more bureaucracy and confusion and is out of sync with real world stresses that taxpayers, tax practitioners and small businesses are dealing with.”

- AICPA President and CEO Barry Melancon, CPA

If you have questions -

We are continuing to work diligently to process returns as usual and will be in contact with clients directly with updated instructions as applicable. Our team is here to sort through any confusion you may have about when, how, and where you should file.